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| 9/14/2011 3:00 PM ET | News Release Index
| | Sniper Resources: Nevada gold in the crosshairs | | | Mining is big business in Nevada and the state accounts for nearly eighty percent of all gold produced in the United States. It is also one of the best places in North America for the discovery of new gold resources. The combination of favorable geology and mining-friendly policy enables large scale projects to advance through development.
None of this comes as news to Scott Baxter, President of Sniper Resources Ltd. Baxter has established a successful track record of mineral exploration in Nevada. Several years ago he was running Tone Resources, a company that was eventually acquired by US Gold Corp in 2005. Investors made a lot of money on that deal and they are counting on Baxter to deliver again with another exploration story that is focused in Nevada.
A strong management team is an essential part of the success for a junior explorer, and co-founder Doug McGibbon serves as Vice President of Exploration for Sniper. McGibbon has been active in Nevada for the majority of his career, and he understands the geology that has contributed to the emplacement of multi-million ounce gold deposits. The forces of geology concentrated along regional fault structures, after millions of years of activity, have created the ideal conditions for the formation of large gold deposits in close proximity within defined mineral trends extending through Nevada.
Sniper controls a stable of highly prospective properties located in these established mining trends, and in close proximity to large gold deposits. Systematic exploration is underway at the Overland Pass project, immediately adjacent to Barrick Gold’s Bald Mountain open pit gold mine which is currently in the midst of a $200 million expansion program. More importantly, this property is underlain by similar productive geologic formations of sedimentary rock that host Carlin style gold deposits elsewhere in Nevada.
A drill program was launched by Sniper in 2006 that encountered 50-60 feet intervals of heap leach grade gold in two of the holes. There is widespread evidence of alteration throughout the property, with gold showings and indicator minerals such as antimony, arsenic, and barite identified in outcrop chip sampling. This represents a compelling exploration target and Overland Pass has been described as the best Carlin style geology in Nevada that does not already have a gold mine on it.
Sniper is awaiting permitting approval and the company plans to commence a second phase drill program this fall to target some of the showings where higher grade surface gold samples were encountered, along with structural features and contact zones. The project is early stage, but it is located in an established mining trend near a big mine, and gold has already been found on the property, so it could evolve into a very exciting discovery play as the next 25 drill holes are punched later this year.
Exploration is also underway in Central Nevada at the Guild Property. Drilling work was first completed on the property by former operators in the mid-1970s. Sniper reviewed the historic results and commenced a reverse circulation drill program earlier in this year that encountered significant intervals of shallow disseminated gold in three holes although some of the drill holes failed to reach the productive sedimentary zones to depth. Surprisingly, gold values were encountered within the younger volcanic rocks in some of the drill holes. This first phase demonstrated the complexity of the geology but has also yielded encouraging potential.
McGibbon has recently completed a follow up program of trenching and sampling work to extend beyond the preliminary work from phase one, to better understand the structural geology. Assay results are still pending from this work, and another RC drill program is planned to commence shortly where secondary targets have been defined. Guild represents a second early stage prospect with the potential to host a Carlin style deposit.
The newly acquired Laura Project represents the third high profile exploration asset for the company. It is located within the Cortez Trend, where some of the most noteworthy discovery success has been reported in recent years. The multi-million ounce Pipeline and Cortez Hills Mines are both high profile gold deposits developed by Barrick Gold. Several other active exploration programs are underway by numerous companies in this productive mining trend. The district has emerged as a hot area play and it serves as a testament to the high caliber of this management team that Sniper was able to acquire the Laura Project, located just a couple of kilometers south of the huge Cortez Hills Mine.
A new all weather road was recently completed to provide access to the large mines nearby, and that runs right through the Laura property. And the project is even more attractive since drilling work completed in the 1970s identified gold showings within jasperoid breccia. McGibbon has chosen to initially focus on the zone containing these gold values, and more fieldwork will be required for target definition before a drill program can be launched. The project is located on the margin of a larger geologic feature, the Caetano Caldera, which also opens the potential for volcanic hosted epithermal gold deposits to have been formed.
While the presence of a successful management team and control of excellent properties are important for an early stage exploration company, Sniper is attractive for many reasons. Management owns a large chunk of the total shares issued, with significant institutional participation as well. The company recently completed a private placement to raise the funding for the ongoing exploration work underway. And the perhaps most important for investors, the company goes about exploration with a sense of urgency. This is a very speculative stock and rewards are generated through success at the end of the drill bit. Scott Baxter understands this fact and he goes about his business with the commitment to advance towards a new discovery. There is no guarantee for what the future may hold, but the company has secured control of attractive properties, and management intends to drill the hell out of these prospects in the pursuit of a successful outcome.
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